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Online Consumers Window Shop More than Impulse Buy

By Jack M. Germain E-Commerce Times ECT News Network
May 2, 2005 5:00 AM PT

The Internet might be turning into the ultimate window shopping experience for online shoppers. Greater sophistication with browsing is making consumers more prone to comparison shop online before actually buying.

Online Consumers Window Shop More than Impulse Buy

Internet shoppers are more prone to visiting 10 or more Web sites before returning to a favored location hours or days later to make a purchase. This new trend of leaving a Web site before completing a sale suggests that Internet merchants need to rethink their marketing strategy and Web site design, says the author of an exhaustive study.

According to the report on Internet shopping habits, online merchants need to shift their focus from why shoppers abort shopping carts to why they leave Web sites without buying.

Report Strategy

This digital window shopping activity is clearly revealed in sales data gathered by ScanAlert between June 2004 and March 2005 from retailers such as GSI Commerce, Ritz Camera, Tiger Direct and other online merchants.

Titled "A New Era of Digital Window Shopping: From Shopping Cart Abandonment to Purchase," the report was scheduled for release yesterday.

The participating companies use security firm ScanAlert's Hacker Safe certification, a system that certifies Web sites as secure from hackers. It audits e-commerce Web sites and maintains daily remote security sweeps to make sure hackers and other Internet intrusions are locked out.

ScanAlert tracks the relationship of sales from Web sites that display the Hacker Safe seal and those that do not. The security firm conducted its study of buying habits by using persistent cookies to track Web visitors.

A permanent cookie is a text file containing an expiration date stored on a Web site visitor's hard drive until it expires or until the user deletes it.

Buying Habits Changing

Online consumers are no longer rushing to click the shopping cart button on Web sites. Instead, they spend days digitally window-shopping before buying, abandoning shopping carts with an ease that frustrates and often confuses online retailers.

"The shopping cart abandonment issue is the most important thing that we uncovered," Ken Leonard, CEO of ScanAlert, told the E-Commerce Times. "Most merchants think that shopping cart abandonment is just part of the online shopping process."

His study showed the average time delay between a consumer's first visit to a Web site and the first purchase was just over 19 hours. About 35 percent of all tracked shoppers took more than 12 hours to make a buy decision, while 21 percent took more than three days, with 14 percent taking more than one week to decide where to buy.

According to Leonard, the abandonment issue and the delay in completing the shopping cart purchase shows behavior that is radically different from two years ago.

Shopping Cart Redesign

"The implication to merchants is that the shopping cart is not just a convenience factor. It must be a comfort zone to shoppers," Leonard said. "These results were not expected."

The length of time from initial visit to actual purchase varies from site to site depending on customer demographics, brand recognition, the number of competitors online and average product price. The data suggests that shopping cart abandonment is actually an habitual part of many consumers' shopping behavior prior to purchasing.

Even more telling, noted the study, is that the shoppers spending the longest time shopping are also the most concerned about the safety of the sites where they shop. The trust factor can become both a strong motivator and a strong barrier to completing a sale.

The report offers two recommendations for converting shoppers into buyers. One is for merchants to create a comfort zone for comparison shoppers. The other is for merchants to move the focus of the Web site from shopping cart abandonment to Web site abandonment.

Thus, site designers must make the shopping experience more informative and the sense of safety more memorable. Otherwise, those who abandon their shopping carts will also abandon the Web site later when it comes to deciding where to buy.

Comparison a New Factor

According to the report, much of the observed increase in shopping cart abandonment over the past two years results from an increase in comparison shopping. As consumers learned to use the shopping cart as a comparison shopping tool, they also learned to leave the Web site as a natural characteristic of electronic window shopping.

"It is very easier to comparison shop online today. Consumers have many new tools," Leonard said. "There is also a connection with the change in shopping patterns and the more widespread use of broadband."

The consumer's ability to make product comparisons online is a factor in site abandonment as well. The study shows that the shortest buying delays involve shopping for the most unique products, while the longest delays occur for more common items.

Web shoppers are now using the Internet as a "catalog of catalogs." This means that Web site operators need new Web site designs to better accommodate digital window shopping and to encourage visitors to return.

Changing the Rules

A common thread is present in all of the consumer tracking observed by the ScanAlert study. Consumers are using the Web tools differently than merchants planned in designing them.

For instance, merchants built trust and security into the concept of the shopping cart. However, consumers want to see trust in the Web site itself. Consumers assess an Internet storefront in much the same way as they view brick and mortar stores. Site appearance, convenience and service all matter.

Shopping cart use is different as well. At each site, shoppers typically load the same or similar items into the shopping cart as a convenient way to compare total costs, including shipping charges.

The shoppers' intent is not to complete a purchase unless they have returned to the site to buy. However, price is not the ultimate determiner.

ScanAlert's data shows that safety and trust often trump price and availability in the online consumers' value calculation.

18-Hour Surprise

John Halliburton, e-commerce marketing manager for Martel Brothers Performance, didn't expect to learn that his customers often take 18 hours to make a purchase from his company's Web site.

In business for 17 years, Martel Brothers Performance sells racing and high-performance parts through both its brick-and-mortar and online stores. Halliburton uses pay-per-click keyword purchases at the major search engines to acquire new customers and uses a mailing list to market to the existing customer base. He also runs co-op print ads in a few national magazines from time to time.

"Our online business now accounts for about 75 percent of total sales. We learned from the tracking report that the average time to conversion for our site was about 18 hours. That surprised us," Halliburton told the E-Commerce Times. "We expected much lower, and frankly it raises more questions than provides answers."

Halliburton is concerned about the implications of the trend report. Prior to the release of the trend report, he was experimenting with loading his pay-per-click campaigns for certain hours when customers are actively researching and price shopping.

"In the short term, we're testing methods that make it easier for the customer to come back and buy from us after the initial visit. We're also tweaking our pay-per-click landing pages in an effort to close the sale on the initial visit," Halliburton said.

"It is critical that we nail this. We know the waiting times will vary depending on the cost and complexity of the product, but we'd like to reduce the average," he said. "I'm fairly certain there isn't a one-size-fits-all solution for us."

Another Vendor Reaction

For Kevin Beresford, president and CEO of Shari's Berries, the shopping trend results left him looking for more information. Shari's Berries sells gourmet chocolate-dipped strawberries in a variety of designs.

Beresford learned from the trend report that the average waiting time for customers to return for a purchase is 15 hours.

"The report certainly piqued my curiosity as it was not what I expected," Beresford told the E-Commerce Times. "I have to dig deeper. I want more data on how many people are buying on first visit. I need to understand why they come back and why they didn't buy the first time."

During peak buying seasons, 88 percent of Shari's sales volume comes through the Internet. The non-holiday traffic is about 70 percent.

Beresford said he was particularly interested in the report's implications. He will focus on seeing where changes are needed on the Web site.

"Knowing how to serve up the information better would increase our sales. This would very much determine how we do business," he said.


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